US close: Stocks finish higher despite alarming infection numbers
Wall Street stocks closed in the green on Monday, even as investors digested data showing an accelerated number of new Covid-19 infections in several US states.
The Dow Jones Industrial Average ended the session up 0.59% at 26,024.96, the S&P 500 added 0.65% to 3,117.86, and the Nasdaq Composite was 1.11% firmer at 10,056.48.
It was a broadly green session for the Dow, with the exception of a short dip below the waterline during morning trading, the benchmark having opened 70.79 points higher, putting it on track to snap a three-day losing streak started last week.
The positivity came despite the US reporting more than 30,000 new coronavirus cases on Friday - the country's largest single-day increase since 1 May.
Nevada, Florida, California and Arizona all reported record single-day infection numbers and a total of 24 states showed an increasing trend in cases over the last week.
However, despite the heightened volume of new cases New York City will permit firms to reopen offices from today following a three-month lockdown across the financial centre.
Trade adviser Peter Navarro claimed that while the White House was preparing for a second wave, it wasn't actually expecting one to hit.
"We don't necessarily expect a second wave but prudence dictates that we plan for it. There is no contradiction," he said on Sunday.
Pantheon Macroeconomics chief economist Ian Shepherdson pointed to three of the hardest-hit states - Arizona, Florida and Texas - as being particular cause for concern in the data.
“All three states reported far more cases than on Monday last week, so the seven-day moving average number of new cases continues to rise rapidly, as our final chart shows,” he said.
“The infection rates per capita remain far below the New York peak, but the rates of increase are alarming.
“As far as we can tell, none of these three states has a serious plan to reduce the number of new infections, which are on course to breach 20,000 per day, per state, over the next four weeks or so.”
Shepherdson said that even if, as Florida’s governor Ron DeSantis claimed, the new cases skewed heavily towards younger people, who tend to have much less serious symptoms, such a huge number of cases would put healthcare systems under strain, with deaths increasing.
“The real danger is not so much that large numbers of young adults will die, but that their contact with other people will drive up infection rates among the more vulnerable segments of the population.”
On the macro front, the Chicago Fed's national activity index came in at 2.61 in May, up from a reading of -17.89 a month earlier, while the three-month moving average moved up to -6.65 from -7.5 in April.
Elsewhere, existing home sales plummeted in May, according to the National Association of Realtors, with the Covid-19 pandemic continuing to batter the US economy.
Sales of existing homes fell 9.7% in May to a seasonally adjusted annualised rate of 3.91m units, while sales were down 26.6% year-on-year to record the largest annual decline since 1982 and the slowest sales pace since October 2010.
Still to come, Federal Reserve Bank of Minneapolis head Neel Kashkari was set to deliver a speech at 2330 BST.
In the corporate space, American Airlines shares were down 6.75% after it said it was looking to raise up to $3.5bn in new financing as part of an effort to help it weather the Covid-19 storm.
Among the other legacy carriers, Delta Air Lines was down 0.68% after a choppy session, and United Airlines lost 0.81%.
Discount retail behemoth Walmart added 1.53%, after an upgrade by analysts at UBS.
Tech stocks like Apple, Amazon, Microsoft and Netflix helped keep the Nasdaq in the green, with the group rising by 2.62%, 1.45%, 2.78% and 3.16%, respectively.
Dow Jones - Risers
Nike Inc. (NKE) $99.51 3.89%
Microsoft Corp. (MSFT) $200.57 2.78%
Apple Inc. (AAPL) $358.87 2.62%
Walmart Inc. (WMT) $121.68 1.53%
Visa Inc. (V) $194.96 1.44%
Walt Disney Co. (DIS) $115.92 1.37%
Chevron Corp. (CVX) $91.59 1.06%
Home Depot Inc. (HD) $249.16 1.02%
Exxon Mobil Corp. (XOM) $46.42 0.96%
Goldman Sachs Group Inc. (GS) $203.42 0.89%
Dow Jones - Fallers
Walgreens Boots Alliance, Inc. (WBA) $43.24 -2.02%
American Express Co. (AXP) $99.44 -1.49%
Merck & Co. Inc. (MRK) $76.75 -1.48%
Caterpillar Inc. (CAT) $125.79 -1.31%
International Business Machines Corporation (CDI) (IBM) $121.07 -1.14%
JP Morgan Chase & Co. (JPM) $96.75 -1.08%
Procter & Gamble Co. (PG) $117.75 -0.98%
Pfizer Inc. (PFE) $33.11 -0.93%
3M Co. (MMM) $156.69 -0.92%
Verizon Communications Inc. (VZ) $55.66 -0.89%
S&P 500 - Risers
Gap Inc. (GPS) $11.54 8.26%
Foot Locker Inc. (FL) $29.52 5.09%
AES Corp. (AES) $13.98 4.80%
Synopsys Inc. (SNPS) $193.27 4.78%
Advance Auto Parts (AAP) $151.60 4.62%
Fortinet Inc. (FTNT) $142.87 4.51%
Best Buy Co. Inc. (BBY) $84.78 4.41%
Nike Inc. (NKE) $99.51 3.89%
Resmed Inc. (RMD) $179.11 3.70%
Chipotle Mexican Grill Inc. (CMG) $1,070.25 3.59%
S&P 500 - Fallers
American Airlines Group (AAL) $14.92 -6.75%
Norwegian Cruise Line Holdings Ltd (NCLH) $17.09 -6.20%
Royal Caribbean Cr (RCL) $51.86 -6.17%
NetApp Inc. (NTAP) $42.30 -4.04%
Wynn Resorts Ltd. (WYNN) $83.32 -4.00%
Carnival Corp. (CCL) $17.23 -3.37%
Westrock Company (WRK) $27.38 -3.32%
Cabot Oil & Gas Corp. (COG) $18.07 -3.32%
Albemarle Corp. (ALB) $75.79 -3.28%
Host Hotels & Resorts Inc. (HST) $11.29 -3.26%
Nasdaq 100 - Risers
Synopsys Inc. (SNPS) $193.27 4.78%
Paypal Holdings Inc (PYPL) $170.26 3.59%
Broadcom Inc. (AVGO) $313.54 3.56%
Idexx Laboratories Inc. (IDXX) $325.29 3.37%
Incyte Corp. (INCY) $108.93 3.35%
Mercadolibre Inc. (MELI) $984.54 3.31%
Netflix Inc. (NFLX) $468.04 3.16%
Nvidia Corp. (NVDA) $381.07 2.87%
Cadence Design Systems Inc. (CDNS) $94.46 2.79%
Microsoft Corp. (MSFT) $200.57 2.78%
Nasdaq 100 - Fallers
American Airlines Group (AAL) $14.92 -6.75%
Wynn Resorts Ltd. (WYNN) $83.32 -4.00%
Ulta Salon, Cosmetics & Fragrance Inc. (ULTA) $205.49 -3.16%
Ross Stores Inc. (ROST) $90.68 -2.82%
Cerner Corp. (CERN) $71.20 -2.71%
Biogen Inc (BIIB) $264.29 -2.48%
Regeneron Pharmaceuticals Inc. (REGN) $628.48 -2.40%
Gilead Sciences Inc. (GILD) $75.67 -2.32%
Illumina Inc. (ILMN) $360.48 -2.25%
Seagate Technology Plc (STX) $50.91 -2.19%